The embattled turbine maker confirmed a loss (negative Ebit excluding the impact of integration, restructuring and price purchase allocation) of €760 million in the first quarter of its 2023 financial year (1 October-31 December 2022), as well as a net loss of €884 million.
These losses were each more than double the respective losses it made one year earlier, which were €309 million.
The firm had previously blamed warranty costs related to the component failures for its losses, as well as inflation and supply chain disruption. In an earnings call with investors and journalists, CEO Eickholt would not confirm what components are hit by failures, or whether they related to onshore or offshore turbines, but said the failures are affecting a “broad variety of different components” across various turbine platforms, including those installed prior to 2010.
However, the company also flagged progress with its Mistral turnaround programme, and claimed it was helping to stabilise operations.
Through its Mistral plan, Siemens Gamesa aims to address challenges in rolling out its 5.X onshore wind platform, expand in offshore wind growth markets, and enhance its service offering, in a bid to return to profitability.
With its flagship 5.X onshore platform – which accounted for 74% of orders in the quarter – Siemens Gamesa reported that it was making progress in quality, technological development, manufacturing, installation volume and project delivery.
Meanwhile, new orders signed in the quarter offered Siemens Gamesa much greater protection against inflation, volatility in product costs and logistics disruptions than those signed in the past, it claimed.
Jochen Eickholt, chief executive of Siemens Gamesa, said: “The negative development in our service business underscores that we have much work ahead of us to stabilise our business and return to profitability.
“However, despite the extremely challenging macroeconomic and geopolitical context in which we find ourselves, we have seen progress in other areas, such as with our Siemens Gamesa 5.X platform, thanks to our Mistral programme.”
The turbine maker did not provide financial guidance for its 2023 financial year. However, CEO Eickholt said that expects 2023 to be a “transition year” for Siemens Gamesa, with the company set to return to profitability at an unspecified later date.
Siemens Gamesa has faced continued loss-making, supply chain and transportation issues, and challenges in ramping up its 5.X platform.
Parent company Siemens Energy aims to take greater control of the troubled turbine maker to focus on turning the company around.